JP Morgan Emerging Markets (JMG)
This Bronze Rated trust is regarded as a high quality offering by Morningstar analysts.
The fund has been run by an experienced portfolio manager in Austin Forey since 1997. Forey brings well over two decades of industry expertise, the bulk of which are in emerging markets. He has been with JPM his entire career, resulting in a strong working relationship with his colleagues. He draws on the expertise of the near-40-strong Global Emerging Markets team and can leverage JPM's global research and analytical pool for further ideas.
Forey has made good use of these resources in his management of this fund. Since taking over, it has comfortably outperformed its category peers and returned 8% annualised, some three percentage points more than its Morningstar Global Emerging Markets Equity Category average; it is also ahead of its peers over three, five, and 10 years to the end of September.
On a calendar-year basis, though, it has been a bumpy ride. In 2008 it lost more than 36%, although this was less than its average peer, albeit at the margin; the fund bounced back the following year and gained some 54%, but it underperformed its average peer.
Templeton Emerging Markets Trust (TEM)
Templeton Emerging Markets has weathered several storms, and analysts think it’s well placed to continue – hence why they have awarded the trust a Bronze Rating.
Analysts’ confidence is due in part to the management team at the fund’s helm. Dr. Mark Mobius has been at the firm since 1987, and he has built a strong and loyal team there. It’s a team that comprises more than 30 and is spread globally to enable on-the-ground research.
Mobius is assisted in the day-to-day running of the fund by Allan Lam, Dennis Lim and Tom Wu, and in reality those three are making the investment decisions, although Mobius has oversight of these. All three have worked with Mobius for more than 20 years, so the origins of his style and process are well and truly embedded in their approach.
Baring Emerging Europe (BEE)
While the fund has outperformed its category peers since Matthias Siller's appointment in December 2008, returns thus far in 2014 have been disappointing for shareholders, with the fund trailing both its peers and benchmark by a significant amount.
Much of this is attributable to the fund’s weighting in Russia – the political tensions there being a huge detractor. Given the fund’s investible universe – Emerging Europe is dominated by only a handful of countries and sectors – it's not the first time the fund has experienced such big performance swings, and it’s likely such a pattern will continue, not least because of the possibility for strong political moves in that region.
Each time the fund has subsequently bounced back, with the manager sticking to his process throughout, proving there’s merit in the firm’s approach.
